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H.R. 1199: Small Business Investment Act of 2025

119th Congress · introduced 2025-02-11 · Taxation · Latest: Referred to the House Committee on Ways and Means.

federal

What does this mean?

Official title

Small Business Investment Act of 2025

Plain summary

Small Business Investment Act of 2025 This bill reduces the time period a noncorporate taxpayer is required to hold qualified small business stock (QSBS) before a percentage of the gain on the sale or exchange of such stock may be excluded from gross income. (Limitations apply.) The bill also expands QSBS to include qualified debt instruments and certain corporate stock. Under current law, a noncorporate taxpayer may exclude from gross income 100% of the gain from the sale or exchange of QSBS acquired after September 27, 2010 (or a smaller percentage if acquired on or before such date) and held for more than five years. Further, under current law, QSBS must be C corporation stock. (Exclusions and other requirements apply.) The bill allows a noncorporate taxpayer to exclude from gross income 50% of the gain on the sale or exchange of QSBS (purchased after the enactment date of the bill) held for three years, 75% of the gain on the sale or exchange of such stock held for four years, and 100% of the gain on the sale or exchange of such stock held for five years. Further, the bill expands QSBS to include stock acquired through the conversion of a qualified convertible debt instrument (e.g., bond converted into stock). Under the bill, the holding period of such stock includes the time period during which the qualified convertible debt instrument is held. Finally, the bill expands QSBS to include corporate stock, not just C corporation stock. (Limitations apply.).

Congressional Research Service summary (Introduced in House), quoted unchanged (nonpartisan). Read the source.

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A “Nay” vote

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PSI Sci description of the legislative step (not an opinion).

What does this mean? (plain words)

Official text

Small Business Investment Act of 2025

Source: Congressional Research Service summary (Introduced in House)

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Officials and money

Sponsor: Rep. Kustoff, David [R-TN-8] · 0 cosponsors

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Words on this page, explained (2)
Bill
A proposed law. It becomes law only if it passes the legislature and is signed by the president or governor (or a veto is overridden).
Bond
A way to borrow money. A government sells bonds to raise money now and promises to pay it back with interest over time. Bonds repaid from taxes often need voter approval.

Plain meanings written from linked sources. All words.

Sources

Record fed-us-cong119-hr1199 · catalog fed-us-congress-bills-cong119 · updated 2026-11-03 by psicol fed-bills